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Globalization and Knowledge Spillover: International Direct Investment, Exports and Patents

Author

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  • Chia-Lin Chang

    (Department of Applied Economics, National Chung Hsing University)

  • Sung-Po Chen

    (Econometric Institute, Erasmus School of Economics, Erasmus University Rotterdam)

  • Michael McAleer

    (Erasmus University Rotterdam, Tinbergen Institute, The Netherlands, and Institute of Economic Research, Kyoto University)

Abstract

This paper examines the impact of the three main channels of international trade on domestic innovation, namely outward direct investment, inward direct investment (IDI) and exports. The number of Triadic patents serves as a proxy for innovation. The data set contains 37 countries that are considered to be highly competitive in the world market, covering the period 1994 to 2005. The empirical results show that increased exports and outward direct investment are able to stimulate an increase in patent output. In contrast, IDI exhibits a negative relationship with domestic patents. The paper shows that the impact of IDI on domestic innovation is characterized by two forces, and the positive effect of cross-border mergers and acquisitions by foreigners is less than the negative effect of the remaining IDI.

Suggested Citation

  • Chia-Lin Chang & Sung-Po Chen & Michael McAleer, 2010. "Globalization and Knowledge Spillover: International Direct Investment, Exports and Patents," KIER Working Papers 721, Kyoto University, Institute of Economic Research.
  • Handle: RePEc:kyo:wpaper:721
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    References listed on IDEAS

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    Cited by:

    1. Stek, Pieter E. & van Geenhuizen, Marina S., 2016. "The influence of international research interaction on national innovation performance: A bibliometric approach," Technological Forecasting and Social Change, Elsevier, vol. 110(C), pages 61-70.
    2. Chang, C-L. & McAleer, M.J. & Tang, J-T., 2013. "International Technology Diffusion of Joint and Cross-border Patents," Econometric Institute Research Papers EI 2013-24, Erasmus University Rotterdam, Erasmus School of Economics (ESE), Econometric Institute.
    3. Chia-Lin Chang & Michael McAleer & Ju-Ting Tang, 2015. "Joint and Cross-border Patents as Proxies for International Technology Diffusion," Tinbergen Institute Discussion Papers 15-053/III, Tinbergen Institute, revised 30 Jan 2017.
    4. Chia-Lin Chang & Michael McAleer & Ju-Ting Tang, "undated". "International Technology Diffusion of Joint and Cross-border Patents (Revised version)," Documentos de Trabajo del ICAE 2015-06, Universidad Complutense de Madrid, Facultad de Ciencias Económicas y Empresariales, Instituto Complutense de Análisis Económico, revised May 2015.

    More about this item

    Keywords

    International direct investment; Export; Triadic Patent; Outward Direct Investment; Inward Direct Investment; R&D; negative binomial model;

    JEL classification:

    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • F21 - International Economics - - International Factor Movements and International Business - - - International Investment; Long-Term Capital Movements
    • O30 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - General
    • O57 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Comparative Studies of Countries

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